Statistics released today reveal the UK management consulting sector is expecting strong growth in 2014. Almost all (92 per cent) Management Consultancies Association (MCA) member firms reported that they had met or exceeded their fee income expectations for the year — with around half saying that their fee income is markedly up.
- Digital, retail and infrastructure drive growth
- UK consulting continues to be a premium brand overseas
- Recruitment boost — 77 per cent of MCA firms are recruiting
- Rate of growth to double in just two years
After growing by 8 per cent in 2013, MCA members report that work in critical sectors such as retail, public services and their continuing efforts to improve the performance of the UK's financial services sector are driving strong growth this year. This is in line with the rising growth trend of the last four years, and opens up the possibility that consulting may have achieved double digit growth in 2014.
Consultants are also central to vital components of the UK's growth strategy. Two thirds (60 per cent) of firms recorded an increase in infrastructure advisory — 20 per cent marked and 40 per cent slight. In this vitally important area, the role of management consultants in the inception, financing, integration, design and management of capital projects cannot be overstated. And the boom in Digital consulting continues. Over half (52 per cent) of firms have seen a marked increase in digital advisory work.
Strong overseas performance by UK consultants highlights the important role UK consulting is playing in efforts to re-balance the UK economy towards exports. Around a third (30 per cent) of MCA consulting firms report that over half of their income will come from outside of the UK in 2014. Despite continuing uncertainty, the Eurozone remains a primary target for MCA firms and appears to be outperforming previous years. The Middle East also remains an important target.
Three quarters of MCA member firms report that market conditions are good or excellent and a similar number anticipate rises in consultant numbers, with half saying that this rise will be marked. In addition to the strong performance in digital and overseas work, the MCA report says that increases in operational consulting, business transformation and change management work are positive indicators of an increasingly active economy.
Paul Connolly, Director of the MCA Think Tank, and author of the report, said: "Consulting assignments during the downturn were about helping firms restructure or respond to political scrutiny and new regulatory pressures, but current consulting growth comes from helping businesses develop new ideas and new propositions, especially in areas such as Digital. Our members are critical to UK economic success. Because consulting is growing by helping others grow."
Alan Leaman, CEO of the MCA, added: "Consulting demand remains strong both at home and abroad. However, if the global economic weather does become stormy, the UK, with its action on the public sector deficits, strong inward investment, flexible labour markets, pivotal position in Digital and, as importantly as anything else, its reputation for top quality business advisers, would be as good a place as any — and better than most — to be in business."
Despite awareness of potential issues affecting the performance of the global economy and affecting the UK, expectations for 2015 remain strong with 83 per cent of firms either confident or very confident about the prospects for UK economic growth in 2015. This contrasts with 66 per cent a year ago. And for the first time in many years, all MCA member firms expect to grow slightly or markedly in 2015.